It is understood that as the market price of Zheng Cotton CF2205 contract continues to break upward, the resistance level of 22,000 yuan/ton is close at hand, and the basis difference quotation and fixed price of lint cotton inside and outside Xinjiang have begun to make up for the increase. The spot price of cotton futures has continued to narrow, and the spot quotation has also Gradually moving closer to the lint inventory cost of cotton processing enterprises, some Xinjiang cotton enterprises have the opportunity to unwind as production and sales prices remain flat.
On January 19, the price of “Double 28” machine-picked cotton in the supervision warehouse in Xinjiang rose to 22,800-23,000 yuan/ton, and the “Double 29” machine-picked cotton price rose to 23,100-23,250 yuan/ton (official). At this price, the Nanjiang ginning factory is in a semi-unlocked state.
A cotton processing company in Aksu stated that it plans to hedge 1,000-1,200 tons of “double 29, double 30” and other high-index lint cotton at the main Zheng cotton contract of 21,500-22,000 yuan/ton, and then hedge 800-1,000 tons of lint cotton at 22,000 yuan/ton or above. Double 28” grade lint, the remaining 400-500 tons of lint with low indicators or large impurities will be sold in spot form.
According to the survey, the selling price of “Double 28” grade lint cotton in Xinjiang’s warehouses above 23,300 yuan/ton may cause cotton processing companies to concentrate and place a large number of orders for shipment, thus suppressing the rebound height of futures. From a statistical point of view, as of January 18, 2022, Zheng Cotton has 17,128 warehouse receipts and 1,095 valid forecasts. The number of warehouse receipts is 855 higher than the same period in 2020/21, a year-on-year increase of 5.25%.
However, it is worth noting that in recent trading days, both the daily registration volume of warehouse receipts and the number of valid forecasts have decreased compared with the same period last year, indicating that the space for growth of Zheng cotton warehouse receipts this year is continuously narrowing, and the year-on-year growth rate will also peak and fall. On the one hand, since January, the daily processing volume and daily public inspection volume of Xinjiang cotton have been significantly lower than the same period in 2020/21; on the other hand, entering late December, the impurity content of machine-picked cotton in the middle and late stages is higher than 3.5% (warehouse registration cannot be registered) Orders), the proportion of color grades lower than 41 or horse value above 3.5 is also gradually increasing. It is not cost-effective to generate warehouse receipts. If you choose to hold delivery in May, the payment recovery period will be longer.
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